BLOCKING WEALTH
BSE, is the busiest trading platform in India challenged by a more technology savvy NSE. It's trading index called SENSEX is according to opinion makers a barometer of nation's economic health. BSE has been continuously amending the listing agreement with regard to more transparency in disclosures in conformity with SEBI mandated norms. Certain rogue companies who are called vanishing companies and other sundry names by Ministry of Corporate affairs have been penalised for not having complied with listing regulations and their stocks have been suspended from trading. At last count, there are about 6000 companies. some of these Companies have been suspended for non compliance of some regulations such as non filing of quarterly results, quarterly audit reports, quarterly secretarial reports, annual reports etc. The value of stock which have been suspended from trading is a whopping 15000 crores of Rupees which belong to poor gullible investors who have had no hand in the affairs of the company they invested in good faith. There was some talk in MCA about the need to admonish such companies with a token penalty and permit resumption of trading lest the shareholder suffer. He/she can make an honorable exit once the trading starts. In these days of paperless era, punishing companies for non compliance of data is draconian. You can offer an One time settlement scheme. You can make trading in paperless form mandatory even for small companies. You can revitalise Over the Counter Trading Exchange of India to exclusively deal such stocks. BSE Board considers any such move as infringement in to their sovereign right to penalise erring companies. They should do a re think and allow re listing or resumption of trading on such stocks against which companies there is no serious charge of fraud or scam.
MCA would consider this favorably in the interest of the small investor?
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